I did this problem with different numbers but i cant get the right answers with these new numbers I'd really appreciate help.
I posted a pick on the outline i just need help with the fill in numbers idk what to put. you can also email me at mernoosh at yahoo dot com
I posted a pick on the outline i just need help with the fill in numbers idk what to put. you can also email me at mernoosh at yahoo dot com
| Zippy Company prepares monthly cash budgets. Relevant data from operating budgets for 2012 are: |
| January | February | |
| Sales | $381,000 | $453,000 |
| Direct Material Purchases | 133,000 | 107,000 |
| Direct Labor | 105,000 | 110,000 |
| Manufacturing Overhead | 63,000 | 72,000 |
| Selling and Administrative Expenses | 77,000 | 78,000 |
| All sales are on account. Collections are expected to be 50% in the month of sale, 30% in the first month following the month of sale, and 20% in the second month following the month of sale. Fifty percent (50%) of direct materials purchases are paid in cash in the month of purchase, and the balance due is paid in the month following the month of purchase. All other items above are paid in the month incurred. Depreciation has been omitted from manufacturing overhead and selling and administrative expenses. |
| Other data: | |
| 1.) | Credit sales: November 2011, $220,000; December 2011, $275,000 |
| 2.) | Purchases of direct material : December 2011, $90,000 |
| 3.) | Other receipts: January - Collection of December 31, 2011 interest receivable $3,000 February - Proceeds from sale of securities $5,000 |
| 4.) | Other disbursements: February - payment of $28,000 for land. |
| 5.) | The company's cash balance on January 1, 2012, is expected to be $60,000. |
| Instructions: | |
| 1.) | Prepare schedules for (a) expected collections from customers and (b) expected payments for direct materials purchases. |
| 2.) | Prepare a cash budget for January and February in columnar form. |
| 3.) | When putting in an answer, always round to the nearest whole number. (e.g. 145,000.51 = 145,001). Also, use commas but not dollar signs when answering. Every box requires an answer, even if that answer is zero. Please do not leave any answer field blank. |
| 4.) | On a separate sheet of paper, answer the following: Assuming the company wants to maintain a minimum cash balance of $50,000, what action (if any) should Zippy's management undertake once they see your completed cash budget? |